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1 V1 – JAN 2017 IDH, the Sustainable Trade Initiative Aquaculture Program Farmers In Transition (FIT) Fund 2017 – 2020 Prospectus Contact Roy van Daatselaar Flavio Corsin Program Officer Aquaculture Director Aquaculture, Agrochemicals M: +31(0)6 5286 2394 M: +31(0)6 1140 4008 E: [email protected] E: [email protected] S: r.vandaatselaar S: flavio.corsin

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Page 1: IDH, the Sustainable Trade Initiative€¦ · As part of the 2016-2020 overall strategy of IDH, a Results Measurement Framework (RMF) has been developed. The RMF allows IDH to measure

1 V1 – JAN 2017

IDH, the Sustainable Trade Initiative

Aquaculture Program

Farmers In Transition (FIT) Fund

2017 – 2020 Prospectus

Contact

Roy van Daatselaar Flavio Corsin Program Officer Aquaculture Director Aquaculture, Agrochemicals M: +31(0)6 5286 2394 M: +31(0)6 1140 4008 E: [email protected] E: [email protected] S: r.vandaatselaar S: flavio.corsin

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2 V1 – JAN 2017

Introduction

Health and disease management is arguably the most critical challenge the aquaculture sector faces.

Diseases have always challenged the development of the sector. Although the sector generally bounces

back after an outbreak and considerable progress has been made in pathogen/disease detection, it does

not seem to be any more prepared to deal with diseases than it was two decades ago. In fact, similarly to

previous diseases, the Early Mortality Syndrome (EMS) outbreaks in shrimp in Asia and Latin America have

led to crop failures for several hundred thousands producers, resulting in global price and supply volatility

of farmed shrimp. In subsectors that are not affected by major disease outbreaks the volatility in survival

ranges in the two digit percentage figures for which explanations like weather and seed quality are

generally blamed, often without concrete evidence. Agrochemicals (e.g. antibiotics) use is still prevalent

in large segments of the industry, arguably driven by a general lack of knowledge on the application and

effectiveness of such treatments against the emerging disease problems. This often leads to misuse of

these substances, which may affect food safety and market access of aquaculture products. As food safety

is the top priority for seafood buyers, aquatic animal health management is a critical issue to address.

In 2013 IDH opened its Farmers In Transition (FIT) Fund (the “Fund”). In the first three years the Fund has

been very successful in rolling out global and large scale support to aquaculture producers to implement

better practices and shift to certification. However this mechanism did not address the critical challenges

on health and disease management which often goes beyond the level of the farm. IDH has now

transformed the Fund to specifically address health and disease management in the aquaculture sector

and adopt a more data-driven approach to farming practices.

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3 V1 – JAN 2017

Purpose and objective of the Fund

As outlined in the figure above the Fund can co-invest in field level projects (FLPs) at various levels ranging

from supporting private sector companies to adopt a data-driven approach (e.g. making better use of data

collected for certification purposes) to improving farm efficiency (component 1), to improving disease

management amongst aquaculture producers by developing zonal management regimes (component 2),

to full-fledged landscape integration of zonal management with aquaculture producers and other public

and private sector actors in the landscape with the aim to improve health and disease management for

the area (component 3). These activities in the field can then be linked to platforms at national (component

4, e.g. Seafood Task Force in Thailand or the PPP Fish in Vietnam) or global level (component 5, e.g. GSSI)

as to strengthen collaborative efforts.

Farm level interventions

•Data driven

•Improve FCR, survival %

•FLPs co-funded by the Fund (component 1)

Zonal aquaculture management

•Collective private sector efforts to improve biosecurity, develop contingency plans

•FLPs co-funded by the Fund (component 2)

Integrated landscape management

•Aquaculture & other stakeholders in zone

•Co-design masterplan with local government

•FLPs co-funded by the Fund (component 3)

National Platforms

•PPP's at national level in key countries

•FLPs may link to these activities

Global Platform

•Prioritize agenda, actions, resourcing

•FLPs may link to these activities

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4 V1 – JAN 2017

Principles

IDH will only co-fund private sector supported FLPs and as such requires Applicants to clearly state the

private sector share of co-financing as to account for at least 60% of the total project proposal. The funding

provided by IDH will always be dependent on the private sector contribution.

Focus species for the Fund are pangasius, shrimp and tilapia within the focus countries Ecuador, Indonesia,

Thailand and Vietnam. FLPs for other countries can be considered if relevant.

No separate proposals can be developed that only address component 4 or 5 as the Fund can only provide

direct support to activities under component 1 – 3. The following chapters will explain how the Fund can

co-fund activities under these three components:

Proposals for FLPs should comply with the following criteria:

1. The Applicant can prove it can account for the private sector share of the financing of the project

2. The Applicant has the expertise to implement the FLP.

3. The Applicant can be a non-for-profit organization or a private company.

4. The Applicant is responsible to account for the IDH contribution and the Private Sector

contribution in the FLP to IDH.

5. The Applicant can propose an institution to carry out the data analyses on:

a. Aquatic level1

b. Economic level2

6. The Proposal specifies the exact activities for which support is asked.

7. The Proposal clearly defines a timeline for these activities. FLPs addressing only component 1 may

take 1 – 2 years. FLPs addressing component 2 or 3 may take up 2 – 3 years (final date of

implementation can be no later than 31 December 2020).

8. The Proposal provides a detailed plan for data collection, analysis and feedback.

9. The proposed budget should be reasonable and sufficient, to provide successful implementation

of the FLP.

10. The Applicant and Partners comply with the M&E requirements of IDH as set out in this document.

11. The Applicant and Partners agree through a written commitment that no (mangrove)

deforestation will occur within the proposed project. M&E criteria and management plans may be

developed in areas that pose a high risk for deforestation in order to safeguard the commitments.

12. The Applicant and Partners agree to share lessons learnt and key recommendations generated

from the data analysis.

13. The Applicant agrees to share aggregated information on health and disease provided the

information does not make the producers involved in the project as recognizable externally.

1 With a level of expertise at least comparable to the ERAAAD (either University of Prince Edward Island or the Norwegian Veterinary Institute). 2 With a track record of expertise in increasing profitability in the aquaculture or agriculture sector.

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5 V1 – JAN 2017

Key Performance Indicators

As part of the 2016-2020 overall strategy of IDH, a Results Measurement Framework (RMF) has been

developed. The RMF allows IDH to measure the effects of its programs through Key Performance

Indicators (KPIs). Individual programs such as the Aquaculture program will have to report against

mandatory KPIs which are measured across the board for all programs. Next to the general indicators in

the RMF, the IDH Aquaculture program also has a set of aquaculture specific KPIs. The table below

outlines the KPIs that need to be reported against in all FLPs:

Indicator Metrics

Number of producers/workers (m/f) trained on key subjects for sustainable production

The number (#) of persons trained, with the following distributions: a. Gender segregation b. The number (#) of individual training events c. The topic of the training (see measurement guidance for the

list of topics that should be selected)

Adoption rate by producers/workers (m/f) of improved practices

The number of target producers/workers that adopted the new practices, per practice with the following distributions:

a. Gender segregation b. Percentage of these producers/workers as share of total

population of producers/workers trained

Volume of sustainably produced production

Metric tons (MT) of production segregated for species

Production efficiency Feed Conversion Ratio (FCR)

Fish/shrimp survival Survival rate (%)

Farmland area where trained practices are applied

Hectares (ha) of land where trained practices are applied within the farm system.

IDH has developed a KPI Guidance Document for IDH Aquaculture Implementing Partners (“Guidance

Document”) as a reference for how to measure these indicators. The Guidance Document is attached

hereto as Annex 1.

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6 V1 – JAN 2017

Component 1: Adopting a data-driven approach to optimize production efficiency

Disease outbreaks and volatility in survival is often associated with poor feed performance, resulting in

financial losses and poor efficiency in natural resource use. Data are increasingly being used to identify risk

factors in human or veterinary medicine. Only through population data we can know that doing X (e.g. use

of certain products) is associated with a decreased or increased risk of experiencing disease Y. Huge

amounts of data are being collected e.g. to comply with certification requirements. These data are used

at best to manage farms on a day-to-day basis (e.g. changing water when the data say that the water

quality is poor etc.) or to monitor farm performance and at worse they are only made available to auditors

to grant certification. However, much more can be done with those data if analyzed by professionals like

epidemiologists. A data-driven health and feed performance approach is being developed in order to

improve overall farm efficiency through reduced mortality, disease risk and improved feed conversion.

This approach will eventually support farmers in implementing better management practices and

improving the resilience of the sector. For this model to work successfully IDH aims to facilitate:

1. Data collection on different production parameters at farm level and, as needed involving other

value chain players.

2. Data analysis by aquatic epidemiologists, economists, etc.

3. Feedback to producers on how to mitigate disease risks and optimize production efficiency based

on population statistics.

4. Share experiences to other industry players as to create appetite for this data-driven approach to

be scaled up (e.g. through public sector etc.) as to also improve the effectiveness of response.

Data collection

Data analysis

Feedback and training of producers

Change in management

practices

Improved production

↓FCR ↑Fish survival ↓Disease Risk

Business case

IDH 40%

Private 60%

Funding

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7 V1 – JAN 2017

Eligible activities for co-funding under component 1

Activity Comment IDH % PS %

Data collection by internal (employed) persons

Data collection can be on water quality, fish health, production practices

0% 100%

Data collection by external (contracted) persons

Data collection can be on water quality, fish health, production practices

40% 60%

Data analysis The standard of the institute carrying out the data analyses should have the right expertise. Their level should be comparable to the expertise of ERAAAD3.

50% 50%

Feedback and training of producers

Based on analysis of data 50% 50%

Change in management practices

Based on analysis of data 30% 70%

Project management & reporting (excluding auditing costs)

50% 50%

Financial auditing of the project

100% 0%

Total <40% >60%

What data is eligible for collection under component 1?

Data collection can take place at many different levels, indicators and timelines. The Fund is flexible in terms of the design of the FLP and the type of data that is collected through the various components, as long as a solid plan is in place for the collection and analysis of data, and feedback of outcomes to producers with the aim to improve practices. As such, data collection can include, but is not limited to the information below:

Information about the farm or pond from which information is collected (e.g. location, area, etc.)

Outcomes of production such as yield, crop duration, occurrence of disease, but can include also quality attributes at processing etc.

Production information such as source of seed or feed, agrochemicals being applied. If possible also including occurrence of water exchange, data from water testing etc.

Frequency of data collection (e.g. ranging from data collection only at start and end of crop cycle, to weekly collection of data)

Note that these data points are additional to the mandatory KPIs as outlined in the Key Performance Indicator paragraph.

3 either University of Prince Edward Island or the Norwegian Veterinary Institute

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8 V1 – JAN 2017

Component 2: Adopting a zonal management approach to aquaculture

Implementing improved biosecurity protocols and collective management of critical disease risks amongst

aquaculture farmers with shared (water) resources, aquaculture farmers can improve risk mitigation

resulting in optimized production, lower disease risk and a faster and more targeted response in case of

an emergency. As such, zone management poses a strong opportunity to improve health & disease

management. For this reason, in addition to the data-driven approach to optimize farm efficiency as

outlined above under component 1, zonal management will also be supported through the Fund. This

component can be complementary to component 1.

Eligible activities for co-funding under component 2

Activity Comment IDH % PS %

Items included under Component 1

Data collection by internal (employed) persons

Data collection can be on water quality, fish health, production practices

0% 100%

Data collection by external (contracted) persons

Data collection can be on water quality, fish health, production practices

40% 60%

Data analysis The standard of the institute carrying out the data analyses should have the right expertise. Their level should be comparable to the expertise of ERAAAD4.

50% 50%

Feedback and training of producers Based on analysis of data 50% 50%

Change in management practices Based on analysis of data 30% 70%

Project management & reporting (excluding auditing costs)

50% 50%

Financial auditing of the project 100% 0%

Items specific to Component 2

Identification of the zone including geographical boundaries, stakeholders, issues

50% 50%

Development of zonal management plan focused on health & disease management and production risk mitigation

50% 50%

Implementation of zonal management plan: training of farmers, farmer organization, training on data collection

All clearly linked and identified as needs in the zonal management plan

50% 50%

4 either University of Prince Edward Island or the Norwegian Veterinary Institute

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9 V1 – JAN 2017

Development of farming protocols linked to health & disease management plan

50% 50%

Establishment of (public) private governance body of the zone

50% 50%

Equipment or construction needed to improve health & disease management

Only if clearly linked and identified within the zonal management plan

0% 100%

Water quality tests, kits and sampling tools

Only if linked to the implementation of the zonal management plan and accompanied by a declaration that such tests were not performed before implementation of the zonal management plan

40% 60%

Probiotics or water disinfectants Only if linked to the implementation of the zonal management plan and accompanied by a declaration that such products were not used before

40% 60%

Fish / shrimp health testing Only if linked to the implementation of the zonal management plan and accompanied by a declaration that testing was not undertaken before

40% 60%

Investments and adoption of better practices to improve seed quality

Only if linked to the implementation of the zonal management plan and accompanied by a declaration that such practices were not adopted before

0% 100%

Total <40% >60%

Component 3: Integrated landscape management in aquaculture to mitigate critical production risks

In addition to the zonal management approach to aquaculture as described above as component 2, fully

integrating aquaculture farmers into the wider landscape (including other resource users) potentially

brings the greatest impact in terms of mitigating critical production risks related to health & disease

management. Activities under this component should include mapping of stakeholders within the

landscape (aquaculture producers, other agricultural producers, other industry players, public sector and

regulators), identification or production risks through multi-stakeholder engagement, and the

development of masterplans at landscape level to manage production risks in collaboration with public

authorities and regulators.

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10 V1 – JAN 2017

Eligible activities for co-funding under component 3

Activity Comment IDH % PS %

Items included under Component 1

Data collection by internal (employed) persons

Data collection can be on water quality, fish health, production practices

0% 100%

Data collection by external (contracted) persons

Data collection can be on water quality, fish health, production practices

40% 60%

Data analysis The standard of the institute carrying out the data analyses should have the right expertise. Their level should be comparable to the expertise of ERAAAD5.

50% 50%

Feedback and training of producers Based on analysis of data 50% 50%

Change in management practices Based on analysis of data 30% 70%

Project management & reporting (excluding auditing costs)

50% 50%

Financial auditing of the project 100% 0%

Items specific to Component 2: N/A as Component 3 has similar interventions as Component 2, though specifically includes collaboration with public regulators

Items specific to Component 3

Identification of the zone including geographical boundaries, all stakeholders in the landscape, issues

50% 50%

Development of zonal management masterplan focused on health & disease management and production risk mitigation

50% 50%

Implementation of zonal management masterplan: training of farmers, farmer organization, training on data collection; all in collaboration with public authorities

All clearly linked and identified as needs in the zonal management masterplan

50% 50%

Development of farming protocols linked to health & disease management plan

50% 50%

Establishment of public-private governance body of the zone

50% 50%

5 either University of Prince Edward Island or the Norwegian Veterinary Institute

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11 V1 – JAN 2017

Equipment or construction needed to improve health & disease management

Only if clearly linked and identified within the zonal management masterplan

0% 100%

Water quality tests, kits and sampling tools

Only if linked to the implementation of the zonal management masterplan and accompanied by a declaration that such tests were not performed before

40% 60%

Probiotics or water disinfectants Only if linked to the implementation of the zonal management masterplan and accompanied by a declaration that such products were not used before

40% 60%

Fish / shrimp health testing Only if linked to the implementation of the zonal management masterplan and accompanied by a declaration that testing was not undertaken before

40% 60%

Investments and adoption of better practices to improve seed quality

Only if linked to the implementation of the zonal management masterplan and accompanied by a declaration that such practices were not adopted before

0% 100%

Total <40% >60%

National & Global Platforms

Activities under component 1 to 3 can be linked to National or Global Platforms as to strengthen

collaborative efforts between public and private actors towards improved health & disease management.

The Fund is not open to proposals which only address this level of interventions but instead IDH

incentivizes Applicants to nest FLPs under existing platforms (e.g. GSSI, Seafood Task Force in Thailand,

PPP Fish in Vietnam). Contact IDH to discuss the relevance of this.

Additional Funding

The Applicant may for all components involve other sources of funding (e.g. public) which may

complement the funding from IDH and the private sector. However this funding does not affect the ratio

of IDH vs. private sector contributions of 40% - 60%.

Both for the data-driven approach under component 1 as well as for the zonal management approach under component 2 and 3 there may be additional sources of private sector funding associated with certification, which can be taken into account. Although the FIT Fund cannot co-fund efforts towards achieving certification, IDH recognizes that certified producers contribute to responsible production by adhering to criteria on health and feed management as set out in those standards. Accounting for such additional contributions brings two advantages to the application:

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12 V1 – JAN 2017

(1) these efforts will be considered by IDH as to strengthen the application and may therefore

ease the approval of proposals and (2) Applicants bringing in a significant amount of additional private sector investments may apply

a more flexible co-funding ratio. The core IDH vs. private sector ratio (40-60 as indicated above) may in this case be adjusted as long as it never fall below 50% - 50%, whereas the total ratio IDH vs. private sector (including also the efforts towards certification) must be <30% - >70%.

The list below outlines eligible activities which can be considered additional private sector funding if linked to certification efforts:

Activity Comment IDH % PS % Additional PS %

Consultant fees associated with support to producer to comply with certification

0% 0% 100%

Establishment of new treatment ponds for water and/or sludge and associated facilities

Compliant to requirements as set out in standard e.g. aerator systems, seed of aquatic species for water treatment

0% 0% 100%

Raising dykes if to comply with standards to prevent escapees

Compliant to requirements as set out in standard

0% 0% 100%

Difference in price between “responsible” feed and conventional feed

Compliant to requirements as set out in standard and only if accompanied by a declaration that the responsible feed was not used before

0% 0% 100%

Difference in price between high quality (e.g. based on disease status) fish seed and conventional seed

If accompanied by a declaration that high quality seed was not used before

0% 0% 100%

Difference in price between high quality (e.g. based on disease status) broodstock and conventional broodstock

If the project includes also interventions at the hatchery level in addition to interventions at the farm level where the seed will be stocked, and only if accompanied by a declaration that high quality broodstock was not used before

0% 0% 100%

Total 0% 0% 100%

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13 V1 – JAN 2017

Innovation Next to the standardized FLP approach as outlined above, the FIT Fund will allow for a small portion of funds to be allocated to innovative approaches addressing health and disease management. All Eligibility Criteria still apply, as does the IDH vs. private sector funding ratio of 40% - 60%. Further specifications about the target setting and KPIs need to be discussed with the IDH Aquaculture Program Team, yet requirements to take into account are:

Scalability of the approach

Pre-competitiveness of the approach

Private sector buy-in to the project

Process

Applicants whom want to develop FLPs which only address component 1 can directly fill in the FLP

Application Template. For component 2 and 3 IDH asks Applicants to first develop a concept note following

the guidance of the Application Template. Upon consultation with IDH the Applicant may then develop a

Full Proposal. Review of Full Proposals and feedback by IDH may take up three weeks, upon which an

update to the proposal may be requested based on the feedback. Final Proposals will have to be presented

to an Investment Committee at IDH which may take four weeks. Please contact IDH for the Application

Template and further information on timelines.

Selection Criteria

FLP proposals will be assessed against the following criteria:

Value (=impact) for money proposition

Private sector co-funding (the higher the better)

Additional private sector investments in certification (the higher the better)

Relevance of geography (priority country)

Preliminary commitment of companies in zone

Preliminary commitment of public sector in zone

Interest from other sectors

Potential link to (inter)national platform

Presence of landscape issues

Human resources availability at IDH to monitor the project

Funding agreement

Upon final approval of the proposal, IDH will draft a funding agreement. All funding agreements will be

subject to the General Terms and Conditions of IDH, the Sustainable Trade Initiative (“GTC”, attached

hereto as Annex 2). These GTCs state the rights and obligations of both the contracting party and IDH

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14 V1 – JAN 2017

regarding their cooperation in general. By handing in a proposal, the Applicant declares to

unconditionally accept to the contents of the GTC.

Confidentiality

The documents provided to the Applicant by IDH will be handled with confidentiality. The Applicant will

also impose a duty of confidentiality on any parties that it engages. Any breach of the duty of

confidentiality by the Applicant or its engaged third parties will give IDH grounds to reject the proposal,

without requiring any prior written or verbal warning.

All information, documents and other requested or provided data submitted by the Applicant will be

handled with due care and confidentiality by IDH. The provided information will, after evaluation by IDH,

be filed as confidential. The provided information will not be returned to the Applicant.

Contact

Roy van Daatselaar Flavio Corsin Program Officer Aquaculture Director Aquaculture, Agrochemicals M: +31(0)6 5286 2394 M: +31(0)6 1140 4008 E: [email protected] E: [email protected] S: r.vandaatselaar S: flavio.corsin Annexes Annex 1: KPI Guidance Document for IDH Aquaculture Implementing Partners Annex 2: General Terms and Conditions of IDH, the Sustainable Trade Initiative